Question

henytakeAssighmentMain.dofinvoker assignmentstak or assignment take8inprogress falseAI Product-Costing Accuracy, Plantwide and Departmental Rates, ABC Escuha Company produces two type of calculators: sdentific and business. Both products pass through two producdng departments. The business Calcoulator is by far the most popular. The following data have been gathered for these two products: Product-Related Data Scientific Business Units produced per year Prime costs Direct labor hours Machine hours Production runs Inspection hours Maintenance hours 76,000 $239,000 104,800 52,200 100 2,000 2,250 760,000 $2,390,000 1,048,000 522,000 150 3,000 9,000 Department Data Department 1 Department 2 Direct labor hours: 78,000 125.211 203,760 26,800 922 240 Scientific calculator Business calculator Total Machine hours: 26,500 25,700 421 480 447 190 Scientific calculator 100.520 Business calculator Kpr Previous Check My Work 3 more Check My Work uses remaining for Grading Email Instructor Save and Exit Submit 211 AM ^ョads) ENG 29/01/2019

Answer 1

1)	Plant wide rate = (882500+776000)/(203760+949040) =	$                1.44	per direct labor hour
	Overhead cost per unit:			Total overhead
	Scientific = (104800*1.44)/76000 =	$                1.99	per unit
	Business = (1048000*1.44)/760000 =	$                1.99	per unit	$       16,60,032
2)	Departmental rates:
	Department 1 = (882500/447180) =	$                1.97	per MH
	Department 2 = (776000/949040) =	$                0.82	per DLH
	Overhead cost per unit:
	Scientific = (25700*1.97+26800*0.82)/76000 =	$                0.96	per unit	$       16,59,157
	Business = (421480*1.97+922240*0.82)/760000 =	$                2.09	per unit
	Department 1 = (882500/203760) =	$                4.33	per DLH
	Deparment 2 = (776000/127020) =	$                6.11	per MH
	Overhead cost per unit:
	Scientific = (78000*4.33+26500*6.11)/76000 =	$                6.57	per unit	$       16,58,251
	Business = (125760*4.33+100500*6.11)/760000 =	$                1.52	per unit
3)	Activity rates:
	Cost pool	Overhead Cost	Activity Volume	Activity Rate
	Set up costs	451000	250	$         1,804.00	per set up
	Inspection costs	350000	5000	$               70.00	per inspection hour
	Power	430000	574200	$                 0.75	per machine hour
	Maintenance	427500	11250	$               38.00	per maintenance hour
	Total	1658500
	Allocation of OH to products:
	Cost pool	Activity rate	Overhead allocated
			Scientific	Business	Total
	Set up costs	$        1,804.00	$      1,80,400	$         2,70,600	$        4,51,000
	Inspection costs	$              70.00	$      1,40,000	$         2,10,000	$        3,50,000
	Power	$                0.75	$          39,150	$         3,91,500	$        4,30,650
	Maintenance	$              38.00	$          85,500	$         3,42,000	$        4,27,500
	Total		$      4,45,050	$       12,14,100	$     16,59,150
	Overhead cost per unit using ABC:
	Scientific = 445050/76000 =	$                5.86
	Business = 1214100/760000 =	$                1.60